Fowler Co. provides the following summary of its total budgeted production costs at three production levels.
The cost behavior of each of the costs, respectively, is:
A) semivariable, variable, fixed, and variable.
B) variable, semivariable, fixed, and semivariable.
C) variable, fixed, fixed, and variable.
D) variable, semivariable, fixed, and variable.

Question

Fowler Co. provides the following summary of its total budgeted production costs at three production levels.
 The cost behavior of each of the costs, respectively, is:
A) semivariable, variable, fixed, and variable. 
B) variable, semivariable, fixed, and semivariable. 
C) variable, fixed, fixed, and variable. 
D) variable, semivariable, fixed, and variable.

Quizplus · Accepted Answer

Cost A is variable as it is consistently $1.42 per unit for each quantity. Cost B is semivariable as it varies between quantities but not consistently so a portion must be fixed. Cost C is fixed as it is the same for all quantities. Cost D, like Cost A, is variable, at $1.63 per unit.

Fowler Co Provides the Following Summary of Its Total Budgeted Production